Diabetes and impaired glucose tolerance is a major cause of morbidity and mortality worldwide. Normal glucose homeostasis requires that insulin is properly synthesized and secreted from pancreatic [unreadable]-cells upon periodic increases in blood glucose level. Disturbances in [unreadable]-cell function could result in the loss of glucose-stimulated insulin secretion, a major cause for type II diabetes. Recent studies demonstrated an association between [unreadable]-cell function, proliferation, and survival with an intracellular signaling pathway termed the Unfolded Protein Response (UPR). Upon accumulation of unfolded proteins in the lumen of the endoplasmic reticulum (ER), signal transduction pathways are activated to increase the rate of protein clearance from the ER and to decrease the rate of overall protein synthesis and translocation into the ER. These responses collectively enable cells to tolerate and survive conditions that disrupt the normal protein folding and protein secretion processes in the ER. The longterm goal of this proposal is to understand the molecular mechanism of the UPR and ultimately design new therapeutic approaches to treat diabetes and other related diseases. A class of novel transmembrane ER stress sensors including IRE1, PERK, and ATF6 mediate activation of the UPR. Our current study will focus on the structure and function of IRE1 and PERK. Under normal conditions, both IRE1 and PERK are maintained in an inactive, monomeric form by binding to ER chaperone BiP. Upon ER stress, BiP is released from these two proteins, both of which homodimerizes to activate downstream signaling events. Three specific aims will be pursued in this proposal. First, crystal structure of the PERK luminal domain will be determined to identify molecular interactions that mediate PERK-specific UPR activation in the ER lumen. Second, crystal structure of IRE1 luminal domain in complex with BiP will be studied to understand the molecular mechanism underlying BiP-dependent regulation of the UPR signaling. Third, crystal structure of IRE1 cytosolic domain will be characterized to examine molecular interactions that mediate phosphorylation-dependent IRE1 activation on the cytoplasmic side of the ER membrane. Results from these studies will significantly broaden and deepen our understanding towards to the molecular mechanism underlying the UPR activation.